Recently a client asked me this question,

'I run a small fashion business, but i want to grow it into a huge fashion brand. Now I need to register my business and I'm confused between Business Name and Limited Liability Company. Which one is more suitable for my business?

A lot of small business owners (including those that have already registered their business with the CAC) do not know the difference between a business name and a limited liability company, and how to choose the best structure for their business.

By the way, if you are reading this post, my guess is that you are considering incorporating a company or registering a business with the CAC.
And if that's correct, then you deserve a Congratulations! Because not only are you taking a very bold step in starting your business right, which is to register it with appropriate authority, CAC in Nigeria (just like this my fashionista client was trying to do), you are also going to be getting a very valuable piece of information that will help you make a very sound decision on the right structure for your business.

There are many different structures to be considered when you are trying to register a business in Nigeria. But the structure you choose depends on the nature and scale of your business.

However the most common are Business Name and Limited Liability Company. This is because they are most suitable for small businesses and their processes are simple and can easily be completed.

There are others; like Limited liability partnership, Limited Partnership, Public Limited Company, Private Unlimited Company, Public Unlimited Company, etc. But I want this article to be focused on responding to this question my client raised.

The most important thing I will tell you about a business name is that it does not assume a separate legal entity. It is one and the same with the owner(s).

With a business name, the business cannot sue or be sued, and you cannot purchase properties in the name of the business!
It does have its advantages.
If you are interested in running a one-man business, where everything revolves around you and you alone, then a business name might be the best bet. It is also more affordable to set up, with less regulatory requirements.

With a company (Private Limited Liability Company; LLC), the first attractive bit is that the company is a separate legal entity from the owner(s)! .
To break it down, if you own a company limited by shares (that's another name for LLC), the company is regarded by law as a distinct legal person from you; the owner.

You can be personally broke while the company is rich and on the other hand, you can be very rich while the company is broke.
There is no abnormality there, unless off course you clearly enriched yourself at the expense of the company.

The death of the founder does not necessarily have any effect on the company as the company has a life of its own. This is why companies like Coca cola, General electric and Ford Motors are still in existence long after their owners are gone. But off course you have to put a very sound successive plan in place for your own company if you want it to outlive you in the real sense.

It is worthy of note that in Nigeria, a private limited liability company can have up to 50 shareholders!
With recent amendments to the Company and Allied Matters Act (CAMA), a single person can incorporate a limited liability company unlike before when a minimum of two shareholder is required.

Now with that said, you may have fallen in love with one of these structures over the other, but choosing the best structure for your business is beyond love. There are a number of factors to consider when trying to choose the best structure for your business.

I have compiled 11 of this factors and discussed them in details in this video linked below.

https://www.youtube.com/watch?v=3z8-wz98zIw

I hope this helps you.

If you want to register your business with the CAC
Kindly get in touch with me on this number
CALL/WHATSAPP 08027877515

Can I upgrade a registered business name to a limited liability company,still retaining same name?

carl90:
Can I upgrade a registered business name to a limited liability company,still retaining same name?

Yes can... But it'll cost a lot.

You will need to pay for annual returns for the years since the business was registered.

And then apply to the Registrar General of CAC for permission to upgrade your business name to a limited liability company.

Once you get approval, you will then pay for the upgrade...

Most clients opt for a new registration after we've calculated the cost.

You can get in touch on WhatsApp 08027877515 let's discuss your case in details...

Seven Reasons You Need to Register Your business with the CAC

1. Corporate Account: You can open a corporate account. Your customer/clients will feel more comfortable paying into a corporate account than into a personal account.
2. Good Reputation: Customers and clients are more comfortable dealing with a registered business, than with one that is not registered.
3. Easily Access Funding: some loans and especially government grants are only accessible to registered business.
4. Bid for contracts: Evidence of CAC registration, one of the requirement for government contracts.
5. International Trade: It is easier to obtain visa and travel to other countries for business, if your business is registered.
6. Separate Yourself from the Business: To ensure the profitability of your business, and guarantee continuity, you need to allow your business to run on it's own, without depending so much on you. First you need to register the business, then open a corporate account for it, employ staff who will manage the day to da running of the business, pay yourself salary instead of pilfering/tempering with the business money, and then make sure there's a percentage of you monthly profit set aside for the growth of the business for your business. But the miracle starts with registering the business with the CAC.
7. Close Oversea Deals Faster: Foreign partners/investors/suppliers are more likely to trust and deal with a registered business than an unregistered one.

Now Stop Wasting Time, Lets discuss and start your business registration
Business Name N20,500
Limited Liability Company N48,500
Incorporated Trustees (NGOs, Foundation, Church, Association, Clubs, etc) N95,000

Call/WhatsApp 0 8 0 2 7 8 7 7 5 1 5
Email: starupconsults@gmail.com

Seven Reasons You Need to Register Your business with the CAC

1. Corporate Account: You can open a corporate account. Your customer/clients will feel more comfortable paying into a corporate account than into a personal account.

2. Good Reputation: Customers and clients are more comfortable dealing with a registered business, than with one that is not registered.

3. Easily Access Funding: some loans and especially government grants are only accessible to registered business.

4. Bid for contracts: Evidence of CAC registration, one of the requirement for government contracts.

5. International Trade: It is easier to obtain visa and travel to other countries for business, if your business is registered.

6. Separate Yourself from the Business: To ensure the profitability of your business, and guarantee continuity, you need to allow your business to run on it's own, without depending so much on you. First you need to register the business, then open a corporate account for it, employ staff who will manage the day to da running of the business, pay yourself salary instead of pilfering/tempering with the business money, and then make sure there's a percentage of you monthly profit set aside for the growth of the business for your business. But the miracle starts with registering the business with the CAC.

7. Close Oversea Deals Faster: Foreign partners/investors/suppliers are more likely to trust and deal with a registered business than an unregistered one.

Now Stop Wasting Time, Lets discuss and start your business registration
Business Name N20,500
Limited Liability Company N48,500
Incorporated Trustees (NGOs, Foundation, Church, Association, Clubs, etc) N95,000

Call/WhatsApp 0 8 0 2 7 8 7 7 5 1 5
Email: starupconsults@gmail.com

MORE TESTIMONIALS

First contact was April 21, 2022

He paid for the service on 22nd of April,

...and today May 4 , 2022 his company was successfully registered...

Exactly 7 working days considering that May 2nd and 3rd were public holidays.

That's how we roll...

Call/WhatsApp 08027877515